Academic journal article Duke Environmental Law & Policy Forum

Transmission Siting in Deregulated Wholesale Power Markets: Re-Imagining the Role of Courts in Resolving Federal-State Siting Impasses

Academic journal article Duke Environmental Law & Policy Forum

Transmission Siting in Deregulated Wholesale Power Markets: Re-Imagining the Role of Courts in Resolving Federal-State Siting Impasses

Article excerpt

INTRODUCTION

During most of the twentieth century, state and local regulatory bodies coordinated the siting of power plants and transmission lines. (1) These bodies focused on two important issues: (1) the determination of "need," so as to avoid unnecessary economic duplication of costly infrastructure; and (2) environmental protection, so as to provide local land use and other environmental concerns input on the placement of necessary generation and transmission facilities. (2) With the rise of a deregulated wholesale power market, the issue of need is increasingly determined by the market, not regulators. Environmental concerns with siting, however, frequently remain contested, especially locally, but the regulatory apparatus for processing these concerns faces new challenges in deregulated markets. As this Article suggests, environmental concerns in transmission line siting will increasingly be addressed at the federal level, with federal concerns predominating consideration of the issues. The dormant commerce clause does much of the work towards making this a predominantly federal concern, but eventually the Federal Energy Regulatory Commission's ("FERC's") jurisdiction over such matters must be expanded by statute.

Even if Congress does not expand FERC's jurisdiction, this Article argues that courts can play a positive role to facilitate the resolution of state-federal siting conflicts. A recent siting dispute involving a power line in the Long Island Sound illustrates this fundamental shift in the environmental discourse of siting proceedings, as a well as a need for modifications to federal law regarding transmission siting. (3) Ultimately, FERC may need authority to preempt state siting laws, but absent congressional action, courts might empower state and local siting boards to take into account federal goals in competitive markets in making siting decisions.

I. THE CROSS-SOUND KEYSPAN TRANSMISSION LINE SITING DISPUTE

A recent example of the conflict between state siting and deregulated wholesale power markets involves the Cross-Sound KeySpan transmission project. Regulatory officials in the state of Connecticut have strongly opposed the Cross-Sound Cable, a 23-mile merchant transmission line that would allow Long Island Power Authority to import power to Brook Haven, Long Island from New Haven, Connecticut, leading to significant delays in the operation of the project. (4) The project sponsor built the line in 2002, following FERC's approval of retail sales at negotiated transmission rates, (5) as well as permit approvals by the Army Corp of Engineers, the New York Public Service Commission, the Connecticut Siting Council, and the Connecticut Department of Environmental Protection. (6) The project complied with all state siting and environmental statutes, except for a provision of its state-issued permit that required the lines to be buried at a certain depth. (7) Expansion of transmission access to locations such as New York City would provide important capacity, and may have helped in absorbing some of the transmission shortages that exacerbated the Summer 2003 blackout. (8)

In burying the transmission line, the project sponsor encountered some problems. It discovered hard sediments and bedrock protrusions along portions of the route, and immediately notified the Army Corps and the Connecticut Department of Environmental Protection. (9) Some Connecticut officials cited environmental concerns in opposing the project, such as impacts on shellfish beds and operations in the New Haven Harbor. (10) The transmission line was built, however, and according to the project sponsor's CEO the line was "buried to the permit depth along 98 percent of the entire span and over 90% of the route with the Federal Channel to an average of 50.7 feet below mean low water, well below the required level of minus 48 feet." (11)

Nevertheless, the opposition of Connecticut officials kept the transmission line from becoming operational until 2004. …

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